DB Financial Investment has determined that Samsung SDI's performance will fall short of previous estimates. The firm lowered its target price from 480,000 won to 390,000 won. However, it maintained a 'buy' recommendation. On the 18th, Samsung SDI's closing price was 258,000 won.
On the 19th, Research Institute An noted, 'In the fourth quarter of this year, Samsung SDI's consolidated revenue is expected to be 4 trillion won, and operating profit is projected at 63.1 billion won, which is 55% below consensus estimates,' adding that 'persistent sales sluggishness in Europe has worsened the shipment volume and revenue outlook for medium and large electric vehicles (EVs).'
The average selling price (ASP) has continued to decline due to sluggish demand for small batteries, resulting in decreased revenue. DB Financial Investment estimates Samsung SDI's revenue next year to be 19.7 trillion won and operating profit to be 816.5 billion won.
Research Institute An stated, 'In the fourth quarter of this year, production will begin at the Stellantis joint venture (JV) factory,' explaining that 'the U.S. shipment volume is projected at 12.6 gigawatt-hours (GWh), assuming advanced manufacturing tax credits (AMPC) at 486.8 billion won.'
'Currently, the profit consensus assumes high utilization rates at the Hungary factory and favorable sales for new pure electric vehicles (BEVs) from Stellantis,' he said, adding that 'downward adjustments will follow.'
Samsung SDI's products are primarily mounted in premium vehicles in Europe. The current trend of releasing volume models and implementing price reduction strategies due to stricter carbon emission regulations is unfavorable. Research Institute An noted that 'the production of Stellantis volumes starting in the U.S. will also contribute to the decline in Hungary's utilization rate.'
However, Research Institute An believes that Samsung SDI's stock price has fallen to a low level. He stated that 'Samsung SDI is undervalued compared to its peer corporations, making it an attractive opportunity,' adding that 'the plans to mass-produce all-solid batteries by 2027 will make next year's investment plans more visible.'